Trinity House Lighthouse Cottages
November 2016 Purpose…..
• History and how we got started
• Management Model
• Financial Model
• Pros and Cons
• Does it work? Trinity House
Connection of the Corporation of Trinity House with seamarks began in 1566 when an Act of Parliament gave Trinity House the powers to set up ‘beacons, marks and signs for the sea’ Merchant Shipping Act (MSA) appoints the Corporation of Trinity House as the GLA for England and Wales, the Channel Islands and the adjacent seas and islands, with the responsibility for the superintendence and management of all Lighthouses, buoys and beacons within it’s area. Marking & removal of wrecks. Europa Point Lighthouse in Gibraltar. The MSA also gives powers to exploit spare capacity in its assets. History
1st lighthouse built by Trinity House-Lowestoft 1609
Trinity House (TH) automation started in 1980’s.
Currently have 66 lighthouses.
Last manned lighthouse North Foreland 1998.
Some cottages sold off initially.
37 cottages identified as suitable for holiday lets.
Cottages were in very poor state, some just shells i.e. walls and roof, no internal fittings at all.
Getting started
Aim to maintain infrastructure at little or no cost to TH. Subsiduary company of the Corporation of Trinity House set up in March 1993 – Trinitas Services Ltd. (TSL). Lease agreement between TH and TSL commenced February 2002. TSL took out a £300k,10 year loan in 2002 to refurbish cottages. Used a design company to help with fitting out of all cottages. Aimed at higher end specialist holiday cottage market. First cottages available for letting from 2003
Management Model
Management Company to deal with marketing, bookings, housekeeping inc. hampers, customer feedback and assist with design and dressing out.
Management Agreement between TH and TSL to cover cottage maintenance, finances and reporting, annual inspections, Company Secretary function and liaison with Management Company.
TSL have one shareholder (The Corporation of Trinity House), a Board of five (unpaid), and no staff. Financial Model
TH aim to maintain cottage infrastructure at no cost to TH.
TSL aim to generate sufficient profit to fund all annual expenditure and future capital investment for major refurbishments. Surplus in excess of this to be gift aided to the Corporation of Trinity House.
Management Company set cottage tariffs.
Management Company paid a set % of gross income
TSL pay TH lease rentals, annual management fee, and any other costs incurred by TH on behalf of TSL not covered by the management agreement. Results
37 cottages (5 SHT’s, 32 Holiday lets)
2015/16 achieved:
1133 bookings (RR only)
£866k turnover
57% Gross Profit
£112k capital re-investment
Occupancy 60% + Pros
Retains estate infrastructure at no cost to TH.
Value of TH estate increased due to continual investment in properties by TSL.
Enhances profile of TH to general public.
Builds positive relationships with local communities.
Cottages available on the site where weddings are conducted in the Lighthouse is a good selling feature. Cons
Adhoc maintenance response times can be an issue.
Where several cottages on one site, can impact on occupancy.
Remoteness and exposure of sites.
Does it work?
Current occupancy rate increasing.
Tried 2 Management models, prefer the model that includes housekeeping.
Where several cottages on one site, have removed one or two from holiday cottage portfolio and let them on a SHT.
Loan fully repaid and generating sufficient profit to fund on-going refurbishments successfully.
Really important to get a good management company. So, does it Work?
For us: Yes But you need a good Management Company and don’t underestimate the time involved to manage the business, even if you are using a Management Company.